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Clean Cities Coordinators WebcastJanuary 19, 2005
Jim Harger
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Background Largest provider of vehicular
natural gas (CNG and LNG) in North America
Design, build, operate NG fueling stations– Over 160 in operation – Deliver LNG
Good News, for 2004:– 47+ million gallons– $50+ million revenue
Aggressive Marketing Plan tosell 300 million gallons in 2009
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0
50
100
150
200
250
300
2001 2002 2003 2004 2005 2006 2007 2008 2009
Actual Base Forecast Enhanced with Policy
GG
E,
in m
illio
ns
Total Volume Growth (CNG & LNG)
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Why are we successful?
We keep it simple– Taxis and Shuttle Vans
• Make the business case for a skeleton network throughout a metropolitan area
– Transit– Refuse– Airports – Industrial (off-pipeline)
LNG• Western U.S. & Mexico
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What is the Business Case? High Volume Fleets that can achieve our
ROR with a small number of vehicles– 200,000 gallons per year, minimum
If applicable & private fleet allows, carve out 24 hour access dispenser area for other NG fleets– SunLine Transit (Indio & T-Palms)– WM (Moreno Valley & Palm Desert)– Foothill Transit (2005)– PHX RCC (2005)
Retail Gasoline Stations hard to make business case– Unless a Taxi & Shuttle destination
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Why Continued Growth?
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HD & LD Technology Drivers
NG HD engines have distinct advantage of meeting 2010 HD engine standards in 2006– New vehicles and engine models continue to be
made available for HD applications• Volvo 9 liter refuse truck (demo in South San Francisco)• Cummins L Gas Plus• Class 8 engines (Cummins & CAP) will be available in
2006
GM and Honda Small Volume Manufacturers will take the place of
some OEM models– Baytech (GM) & BAF (Ford)– All engines will meet SULEV
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Diesel is getting cleaner, but not fast enough!
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0.20
0.0 1.0 2.0 3.0 4.0 5.0 6.0
NOx (g/bhp-hr)
PM
(g
/bh
p-h
r)
19982002
2010
2007
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Recent Diesel and NG Engine Emissions
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0.0 1.0 2.0 3.0 4.0 5.0NOx (g/bhp-hr)
PM
(g/
bhp-
hr)
CNG < 2003
CNG 2003
Diesel < 2003
Diesel 2003
Source: U.S. DOE
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Economic Drivers Global Energy Dynamics
– High oil prices constrained by world production & increasing demand from China, India and others
– Restricted US refinery production– Low Sulfur Diesel will be expensive!
• Diesel engines costs will also increase– US NG will be supplemented by LNG import terminals
• Large users (UEG) will move to other fuels– Coal and Nuclear
NG Fuel Savings versus Gasoline and Diesel– NG hedging
Grants for Incremental Vehicle Costs– $ have continued to increase over the last 10 years
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Environment Drivers Air Quality Issues
– EPA/Non-Attainment Areas• Arizona, California, New York, Texas, etc.
– Penalties• States Will Lose Federal Funding
– Greenhouse Gases and Climate Changes– Tourism
Health Issues resulting from diesel exhaust– Lung Cancer– Asthma Sufferers– School Buses/Children
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Government Drivers (Enhanced Policy)
Diesel Emission Standards (2007 & 2010) State Mandates (e.g. California Transit Rule) Airport Fleet Mandates (OAK, PHX, SEA & SFO) Grant Money
– TERP ($140 million per year through 2008)– Carl Moyer ($60+ million per year)– SCAQMD – Fine Money (SCAQMD, EPA)
Clear Act ($.50 per gallon tax credits) Hydrogen
– Reality Setting In (15 years out, minimum)– Natural Gas is Best Pathway
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What’s our Commitment
Our Board approved our five-year plan that will require $75 million capital – California LNG Plant – 60+ new stations– Workforce increase for Marketing & Operations
Committed $180K for Phase I development of a 13-liter engine with Clean Air Power & joint marketing program– Dual Fuel engine will meet 2010 standard in 2006– CE & CAP will seek $1.5 million to complete program
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How can you help?
Continue to promote Clean Cities Goals & Policies– Especially fuel diversification
When possible, convince elected officials to include Alt Fuel Incentives for Muni Franchises– Refuse, transit, street sweeping, etc.
• See attached brochure
Any questions regarding NG– Call Jim Harger
• (562) 493-2804 x223• [email protected]